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In the first quarter of fiscal 2016, Nuance reported GAAP revenue of $486.1 million, up from $474.0 million a year ago. Nuance reported non‑GAAP revenue of $494.9 million, which includes $8.8 million of revenue lost to accounting treatment in conjunction with acquisitions, compared to $489.0 million in the first quarter of fiscal 2015. First quarter 2016 reve nue was negatively affected by currency fluctuations as well. If first quarter 2015 currency rates were applied to first quarter 2016 non-GAAP revenue, Nuance would have achieved approximately 2% organic non-GAAP revenue growth for the quarter. In the first quarter of 2016, total non-GAAP recurring revenue was $332.5 million and represented 67% of total non-GAAP revenue, compared to $321.7 million and 66% a year ago. In the first quarter of fiscal 2016, Nuance reported net new bookings of $308.7 million, up 2% from $303.8 million a year ago. If first quarter 2015 currency rates were applied to first quarter 2016 net new bookings, net new bookings would have been up approximately 7% from a year ago.

In the first quarter of fiscal 2016, Nuance recognized GAAP net loss of $(12.1) million, or $(0.04) per share, compared to GAAP net loss of $(50.5) million, or $(0.16) per share, in the first quarter of fiscal 2015. Nuance reported non-GAAP net income of $113.0 million, or $0.36 per diluted share, up from non-GAAP net income of $82.0 million, or $0.25 per diluted share, in the first quarter of fiscal 2015. Nuance’s first quarter fiscal 2016 non‑GAAP operating margin was 28.6%, up from 22.0% in the first quarter of fiscal 2015. Nuance reported cash flow from operations of $141.1 million in the first quarter of fiscal 2016, up 48% from $95.7 million in the first quarter of fiscal 2015.

“In our first quarter, Nuance delivered strong revenue, non-GAAP EPS, and cash flow from operations,” said Dan Tempesta, Nuance’s CFO. “We continued to make substantial progress and achieve meaningful results from our formal transformation program. The entire organization is committed to ongoing performance enhancements that will lead us to improve growth, margins and shareholder value.”

Please refer to the “Discussion of Non-GAAP Financial Measures” and to the “GAAP to Non-GAAP Reconciliations,” included elsewhere in this release, for more information regarding the company’s use of non-GAAP measures.

Conference Call and Prepared Remarks

Nuance is providing a copy of prepared remarks in combination with its press release. These remarks are offered to provide shareholders and analysts with additional time and detail for analyzing results in advance of the company’s quarterly conference call. The remarks will be available at

Nuance will host an investor conference call today that will begin at 5:00 p.m. EST and will include only brief comments followed by questions and answers. To access the live broadcast, please visit the Investor Relations section of Nuance’s website at

. The call can also be heard by dialing 800-553-0358 or 612-332-0636 at least five minutes prior to the call and referencing code 384849. A replay will be available within 24 hours of the announcement by dialing 800-475-6701 or 320-365-3844 and using the access code 384849.

Nuance Communications, Inc. (NASDAQ: NUAN) is a leading provider of voice and language solutions for businesses and consumers around the world. Its technologies, applications and services make the user experience more compelling by transforming the way people interact with devices and systems. Every day, millions of users and thousands of businesses experience Nuance’s proven applications. For more information, please visit

Trademark reference: Nuance and the Nuance logo are registered trademarks or trademarks of Nuance Communications, Inc. or its affiliates in the United States and/or other countries. All other trademarks referenced herein are the property of their respective owners.

Definitions of Bookings and Net New Bookings

Bookings represent the estimated gross revenue value of transactions at the time of contract execution, except for maintenance and support offerings. For fixed price contracts, the bookings value represents the gross total contract value. For contracts where revenue is based on transaction volume, the bookings value represents the contract price multiplied by the estimated future transaction volume during the contract term, whether or not such transaction volumes are guaranteed under a minimum commitment clause. Actual results could be different than our initial estimates. The maintenance and support bookings value represents the amounts billed in the period the customer is invoiced. Because of the inherent estimates required to determine bookings and the fact that the actual resultant revenue may differ from our initial bookings estimates, we consider bookings one indicator of potential future revenue and not as an arithmetic measure of backlog.

Net new bookings represents the estimated revenue value at the time of contract execution from new contractual arrangements or the estimated revenue value incremental to the portion of value that will be renewed under pre-existing arrangements. Constant currency for net new bookings is calculated using current period net new bookings denominated in currencies other than United States dollars, converted into United States dollars using the average exchange rate for those currencies from the prior year period rather than the actual exchange rate in effect during the current period.

Definitions of Non-GAAP Organic Revenue Growth

Organic revenue growth is calculated by comparing current period non-GAAP revenue to non-GAAP revenue from the corresponding prior-year period. For purposes of this calculation, prior period non-GAAP revenue is adjusted to include revenue from companies acquired by Nuance as if we had owned the acquired businesses in all periods presented. Non-GAAP organic revenue growth on a constant currency basis is calculated using current period non-GAAP revenue for entities reporting in currencies other than United States dollars, excluding United States dollar denominated transactions recorded in those entities, converted into United States dollars using the average exchange rates from the prior year period rather than the actual exchange rates in effect during the current period.

Safe Harbor and Forward-Looking Statements

Statements in this document regarding future performance and our management’s future expectations, beliefs, goals, plans or prospects constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Any statements that are not statements of historical fact (including statements containing the words “believes,” “plans,” “anticipates,” “expects,” or “estimates” or similar expressions) should also be considered to be forward-looking statements. There are a number of important factors that could cause actual results or events to differ materially from those indicated by such forward-looking statements, including but not limited to: fluctuations in demand for our existing and future products; changes to economic conditions in the United States and internationally; fluctuating currency rates, our ability to control and successfully manage our expenses and cash position; our ability to

execute our formal transformation program to reduce costs and optimize processes; the effects of competition, including pricing pressure; possible quality issues in our products and technologies; our ability to successfully integrate operations and employees of acquired businesses; the conversion rate of bookings into revenue; the ability to realize anticipated synergies from acquired businesses; and the other factors described in our annual report on Form 10-K for the fiscal year ended September 30, 2015 and our quarterly reports, and other reports filed with the Securities and Exchange Commission. We disclaim any obligation to update any forward-looking statements as a result of developments occurring after the date of this document.

The information included in this press release should not be considered superior to, or a substitute for, financial statements prepared in...